Interaction between monetary and fiscal policy in Algeria: an application of a model with markovian regime switching

Résumé

The aim of this paper is to analyze the dynamic interaction between monetary and fiscal policies in Algeria for the period of 1963-2017. First, we examined the nature of fiscal policies in Algeria using a Structural vector Autoregression model. The results provide evidence of a non-Ricardian fiscal policy in Algeria (validity of the fiscal theory of the price level). Further, the paper analyzes the interactions between monetary and fiscal policie